Octo Telematics - ASSOCONSULT · Pay How You Drive (PHYD) Investment by industrial partner Crash...
Transcript of Octo Telematics - ASSOCONSULT · Pay How You Drive (PHYD) Investment by industrial partner Crash...
Octo Telematics | © 2016 Octo Telematics | Strictly Private and Confidential
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STRICTLY PRIVATE AND CONFIDENTIAL
Roma 9 Giugno 2016
STRICTLY PRIVATE AND CONFIDENTIAL 1
Octo Telematics
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Agenda
2
4. Trasformation for future growth 16
3. Market and industry overview 13
1. Octo Overview 4
2. How Octo creates value 9
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1. Octo overview
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Transforming auto insurance through
behavioral, contextual and driving analytics
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Octo at a glance
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The world’s leading insurance telematics provider
#1 Globally
36% Market Share
$35bn User-Based Insurance TAM
4mm Connected Users
25% Growth in Connected Users y-o-y
>90 Industry Partners
14 years Operating History
100bn Miles of Driving Data
250k Crashes Analyzed
Note: As of December 31, 2015. Estimated market data from Ptolemus Consulting Group; total addressable market data relates to a study commissioned by us.
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Overview of core solutions
6
Insights for
insurance companies Advanced analytics Data collection
Collecting over 2,000 parameter
combinations
Insurance Solutions Software, data and analytics Road Type
Distance
Collision
Direction
Location
Cornering
Braking
Duration
Claim
Management
Crash
Reconstruction Pricing Services
Emergency
Call
Stolen Vehicle
Recovery
Risk
Assessment
Digital
Solutions
• Raw data is processed into actionable
intelligence
• Risk correlation and actuarial
capabilities support industry leading
driver scoring models and pricing
algorithms
…transforming auto
insurance with our
telematics solutions
…feeding into a
proprietary analytics
platform…
Comprehensive set of
real-time driving data
from connected cars…
Continuous innovation
Octo Telematics | © 2016 Octo Telematics | Strictly Private and Confidential
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Our key milestones
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Rapid and
global
user base
expansion >1.0
3.2
4.0
2.2
Connected users (in millions)
1.5
2002 2004 2008 2009 2010 2011 2012 2013 2014 2015 2016 2006
First Canadian partner
First leasing partner
Founded
by Fabio
Sbianchi /
funding by
Business
Angels
Key
corporate
events
London office
opened
HQ moved
to London
Expandin
g industry
partners
network
Innovation
track
record
Vehicle video
monitoring
Unipol
began
testing
telematics
solutions
Doubled
the number
of
insurance
companies
Partnered
with 8 out of
10 largest
insurance
companies in
Italy
New go-to market
route with major OEM
with data monetization
services
Long-term
rental
management
business
Early
pioneer in
insurance
telematics Telematics
services
for OEMs
Consolidation of
North American
operations
Introduction
of initial On-
board Unit
(OBU) Self installable
advanced
OBU
Octo Rider
First North
American
contract
Launch of
Kernel Module
First
partners
Investment
by private
equity funds
First
partner
outside
Italy First UK
partner
Pay How You
Drive (PHYD)
Investment
by industrial
partner
Crash recording
Mileage statistics
Traffic information
Crash
reconstruction
OEM
integration
Further US
wins
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Key metrics used to evaluate the business
(1) Adjusted EBITDA as profit/(loss) for the year before taxes on income, share of profit/(loss) of equity-accounted investees, financial expense, financial income, gain on investments, impairment on assets and other provisions,
impairment losses on non-current assets, depreciation and amortization, Share-based Compensation, social security costs incurred in connection with the Share-based Compensation, personnel expenses incurred in 2013 and 2014
under the LTIP, the Octo North America Earn-out, change in control costs, refinancing costs, Octo North America acquisition costs and group reorganization.
(2) Growth rate includes impact of full consolidation of Octo North America revenues from July 2015.
2013 2014 2015
(in €mm)
Attractive revenue growth
profile built on expanding
industry partnerships and
connected user base
Revenue
108,0 152,1
192,4 6,4
3,7
37,2
10,4
10,6
13,6
€ 124,8 € 166,4
€ 243,2 Services Devices Other
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Strong profitability
development with 50%+
Adjusted EBITDA margins
expected to be sustained
Adjusted
EBITDA(1) € 75,6 € 101,5
€ 128,6
61% 61% 53% % Total
revenue
(in €mm)
Growing connected user
base driven by new
insurance partners and
increased penetration of
existing partners
Connected users 2,2 3,2
4,0
(in mm)
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2. How Octo creates value
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Octo creates value for all stakeholders
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More accurate risk pricing reflects
true driver risk profile
More efficient claims process with
lower average cost and reduced
fraud
More frequent and better quality
interactions with policy holders
Broader telematics services
suite enhances overall
customer experience
Source: Study commissioned from a leading global management consulting firm; data collected by Ptolemus Consulting Group
(1) Combined ratio refers to the measure of profitability typically used by an insurance company, which may be determined by calculating the sum of its losses and expenses and dividing this result by the premiums recognized as earnings
(2) Insurers advertise up to 30% discounts for drivers
Insurance Up to 18% improvement in combined ratio(1)
Drivers Up to 30% discount on premiums(2)
Discounted insurance premiums
resulting from removal of costs in
the value chain
Strong incentive to drive more
safely due to possibility of lower
premiums
Significant time savings and
certainty in the claims process
Access to value-added services
such as stolen vehicle recovery
and emerging call
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Crash reconstruction & triage – Assessing severity of damage
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- Crash is validated against FNOL data
- Severity ranking is set (mechanical and bodily) and crash report is produced
- Spare part magnitude need is set
- More complex crashes (multi-car pile up, severe accidents, etc.) are subject to
a second level of forensic reconstruction
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Pile-up accident
Direction and sequence of impact
Front Back
Left
Right
1○ 2
○
0 2 4 6 8 10 12 14 16
1○ 2○
Max acceleration during impact (g)
Pile-ups are a frequent type of crash in
urban areas
The greater the number of cars that are
involved, the greater the insured loss and
need to determine:
− Which car initiated the collision?
− Who is at fault?
Octo can reconstruct the precise
sequencing, 3D vehicle position and impact
forces of the crash on a milisecond basis
Complex accident reconstruction – Pile up
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3. Market and industry overview
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Octo targets a very large addressable market
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Revenue today
Further upside
potential + eCall / bCall
+ Location based services
+ Diagnostic services
+ Long-term rental management services
+ Other telematics services
User-based insurance
TAM for telematics
service providers
$35bn
Geographic expansion P Expanded service offering P Rapid market penetration P
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Source: Ptolemus Consulting Group
(1) UBI in the US and Canada uses a rollover model where the telematics device is only used for a limited amount of
time. Policies using rollover models are considered as active UBI policies, even though the telematics device may no
longer be used the customer
US 50%
Italy 36%
UK 5%
RoW 9%
US, Italy and UK represent 91% of UBI policies
The US, Italy and UK represent the majority of the UBI
market and its growth
2% 10%
Global
4% 29%
13% 35%
1% 11%
1 12
93
0,2 6
49
0,9
4
11
1
4
2015 2020
0.2%
0.2%
2.8%
0.1%
2010
>0.1
(1)
Increasing penetration rates
Growing number of
UBI policies (mm) UBI policies by country (December 2015)
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4. Trasformation for future growth
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From Vision to Execution : 100 Days Plan “bootstrap”
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Continuous Innovation
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BASIC OBU
Thousands Customer Interactions Connected Things
Billions Trillions Millions
SELF INSTALL
ADVANCED OBU
SMART DEVICES
HOME BOX
BLUETOOTH LOW ENERGY
APP AS A DEVICE
SENSORS
Today 2005 2014
Business Value
Pro
du
cts
• Safety
• Crash Recording
• Mileage statistics (PAYD)
• Info Traffic
100 Days Plan
Se
rvic
es
2014 Near Real Time
innovation on going
• Crash Reporting
• Driving Behavior (PHYD)
• Fleet
• User Interface
• Eco
• Crash
Reconstruction
• FNOL
• SASD
• Advanced fleet
• B2C2B
• Home
• OEM
• VAS
Basic devices Vehicle transactions Customer Interactions
Trilions
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From Vision to Execution : 100 Days Plan “bootstrap”
OctoForce – the full digital customer engagement solution covering marketing, sales & service
Middleware & advanced algorithms backed by the 5 best universities for signal processing & integrated with insurers’ legacy systems on claim management
Our module for advanced analytics, or the journey “from driving behavior to driver genome"
Platform to support idea generation and service catalogue – our collective knowledge exceeds the sum of its parts
Foundation of the new platform covering all the service orchestration, data streaming and rules management & the technology “glue” keeping all other projects together
Knowledge Management
IT Transformation
Statistical & Actuarial
CRM
Crash & Claim
ERP Logistics and financial process integration – the “single source of truth” of our financials
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Recent technology/service focuses and continuous
improvement as the core of our future success